Mike AndesFounder, Augusta Lawn Care and Homeworks · Founder of Homeworks and Augusta Lawn Care

Are you lowballing your own business?

16 Apr 2024 · 0 min

Watch on YouTube

0:28

Short YouTube excerpt (April 16, 2024) from Mike Andes offering pricing strategy advice: if over ~70% of estimates are accepted, prices are likely too low and you may be leaving profit on the table; raising prices until the close/acceptance rate falls to around 40–50% can help maximize profit per job when prioritizing profit over growth.

Questions this video answers

More than 70% of estimates accepted.

Around 40% to 50% acceptance (close) rate.

If every single estimate that you send to customers is being accepted, it's a good indication that your prices are probably too low. So if more than 70% of the estimates you send out are getting accepted, there's a good chance you're leaving profit on the table. And you should raise your prices. Now, as you begin to go into profit mode and not trying to grow, grow, grow, maybe you raise your prices to the point where your close ratio or the percentage of jobs that are accepted is maybe more around 40 to 50%. Then you know you're maximizing profit on every single job.